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    Accounting: Journal Entries

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    A:

    Prepare the journal entry to record each separate transaction. (a) On March 1, DVD Co. issues 44,500 shares of $4 par value common stock for $255,000 cash. (b) On April 1, GT Co. issues no-par value common stock for $50,000 cash. (c) On April 6, MTV issues 2,000 shares of $20 par value common stock for $35,000 of inventory, $135,000 of machinery, and acceptance of a $84,000 note payable.

    B:

    Prepare journal entries to record the following transactions for Skylar Corporation:

    May 15 Declared a $48,000 cash dividend payable to common stockholders.

    July 31 Paid the dividend declared on May 15.

    C:

    The stockholders' equity section of Catalina Company's balance sheet as of April 1 follows. On April 2, Catalina declares and distributes a 10% stock dividend. The stock's per share market value on April 2 is $25. Prepare the stockholders' equity section immediately after the stock dividend.

    Common stock?$5 par value, 375,000 shares
    authorized, 150,000 shares issued and outstanding . . . . . . . . . . . $ 750,000
    Contributed capital in excess of par value, common stock . . . . . . . 352,500
    Total contributed capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,102,500
    Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 633,000
    Total stockholders' equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,735,500

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    Solution Summary

    The solution examines accounting journal entries.

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